After being up for much of the day, the Dow Jones Industrial Average tumbled nearly 100 points, or 1 percent, in the final half hour of trading, settling around 9,950. The S&P 500and Nasdaq each lost about 0.6 percent.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, popped back above 22, after earlier falling as low as 20.10. The gauge hasn't been below 20 since August 2008. At the height of the crisis in October and November of that year, the VIX topped 80.

This morning, Wells Fargo earnings estimates but said that losses from bad loans reached $5.1 billion.

It does not appear that the bank can sustain the third quarter's results. I would avoid the stock," Bove said.

Shares of Wells Fargo shed more than 5 percent and dragged on the financial sector.

Meanwhile, shares of Morgan Stanley gained nearly 5 percent after the brokerage reported its first profit in a year and beat expectations, helped by investment-banking fees.

Bove said recently that Goldman Sachs was the best-managed company in the sector but Citigroup was the most attractive stock.

Also weighing on the market was the fact that oil is now above $80 — crude settled at $81.37 a barrel— and that Wal-Mart announced more holiday price cuts, a bad omen for retail margins this season.

Merck dropped more than 3 percent after a CDC panel, which advises U.S. regulators, said the Gardasil vaccine shouldn't be mandatory for boys the way it is for girls. The vaccine is designed to protect against a sexually-transmitted virus, HPV, that can lead to cervical cancer in women and sexually-transmitted disease and some cancers in men.

Boeing lost 2.5 percent after the aerospace giant missed analysts' earnings target and lowered its guidance.

Eli Lilly beat expectations on both earnings and sales of prescription drugs and raised its outlook. But shares fell 4.5 percent as the company didn't raise the fourth-quarter outlook by as much as they beatin the third.

Elan fell, even after the drug maker raised its earnings guidance for the year.

In tech land, Yahoo and SanDisk's beat earnings expectations. Yahoo's beat had a lot to do with cost-cutting but it also gave an upbeat forecast.

"You have to view Yahoo's cup as being half full rather than being half empty," Gartner analyst Allen Weiner told Reuters. "They seem positioned for a turnaround with the deal with Microsoft and with branding. They are pretty well-positioned to make a comeback in Q4. These numbers are not going to hurt them."

Flash-memory maker Sandisk also delivered an encouraging forecast, saying orders are strong for the current quarter.

The double dose of good news from tech had buoyed the Nasdaq for much of the day but the index eventually succumbed to the selling pressure.

This followed similar outlooks from Intel and Texas Instruments, citing signs of improvement in business spending.

And Dell says PC sales should start to get a boost from Windows 7 starting in mid-2010.

The problem for the market right now is that, while a lot of companies are beating estimates, few are delivering what analysts — and traders — want to see.

"What we really need to see is better profit margins, better sales numbers, which means that the US consumer is coming back," Simon Grose-Hodge, director and investment strategist at LGT Bank in Liechtenstein, said on CNBC today.

The equity rally can continue but "the drivers will definitely change in the next couple of quarters," Franz Wenzel, senior investment strategist at AXA Investment Managers, added. "We think that the junk rally — which has pushed markets higher throughout this year — will peter out and that the quality stocks — individual quality stocks — will basically take over the lead," he predicted.

Sun Microsystems said it's cutting 3,000 jobs ahead of the planned takeover by Oracle . Sun shares lost more than 3 percent.

Freeport-McMoRan shares rose 1.4 percent after the gold and copper miner reported its profit soared in the third quarter, helped by higher metals prices and volume. Though revenue slipped.

The euro traded above $1.50for the first time since August 2008 today, while gold rose nearly $6, settling at $1,063.70 a troy ounce.

On the M&A front, General Electric and Comcast said they were continuing discussions about a possible deal but that there was no timetable for completion. GE shares slipped.

US Bancorp is considering acquiring FBOP, which owns eight banks and could be put up for sale by the Federal Deposit Insurance Corp, according to a report in the Wall Street Journal.

And Geely Automotive's talks to buy Volvo from Ford Motor have reportedly stalled.

In economic news, the Fed said economic conditions either stabilized or improvedin most of the country, according the Fed's "beige book" report, based on reports from its regional branches. Though it also showed consumer spending remains weak.

This morning, the Mortgage Bankers Association reported another drop in home-loan applications as interest rates continue to edge higher.